It's just business: healthcare law's effect on the workplace

Several major provisions of the Affordable Care Act, commonly known as Obamacare, are taking effect in the coming months. Here are some details on what's happening, how it will work, and what it means for you.More >>

Several major provisions of the Affordable Care Act, commonly known as Obamacare, are taking effect in the coming months. Here are some details on what's happening, how it will work, and what it means for you.More >>

(RNN) - The list of major companies publicly pleading their case over rising prices and inability to retain workers once the new healthcare law takes effect has become like a row of dominoes.

First, one company said raising prices was an almost certainty and then another. One company threatened to cut hours for full-time workers or cut them altogether and then another said the same thing.

What is now happening is somewhat of a compromise between both those scenarios - Company A is dropping insurance for employees' spouses if they can get it at their workplace. Or, the company is dropping healthcare coverage for all part-time workers and encouraging them to sign up for insurance exchanges established through the Affordable Care Act.

Companies B, C and D like that idea enough to follow suit and keep the dominos falling.

However, it's unlikely that a significant number of large companies will drop healthcare to avoid the cost.

"An increase in costs of a few percent isn't enough to cause widespread changes in benefits," said Larry Levitt, senior vice president at the Kaiser Family Foundation.

Part of the reason behind that rationale is that several things employers have done or threatened to do has already been going on for some time.

Towers Watson, a human resources consulting company, conducted a survey that found 1-in-5 companies already impose a surcharge to insure employees' spouses if they can obtain coverage elsewhere. The average charge is $100 per month.

This month UPS announced it would stop offering healthcare coverage to spouses of 15,000 workers who could get coverage through their own employers. Other companies like Home Depot, Darden Restaurants and the University of Virginia - to name a few - have adopted similar strategies.

Cost-cutting measures are also nothing new, even when that means passing along costs to workers. The rise in employees' contributions to healthcare coverage the past decade has been triple that of wage increases.

The corporate exchange program goes into effect in 2015, a year later than previously planned due to corporate pushback about complicated paperwork and preparation time. That has allowed big businesses several months to get creative in providing coverage options.

There are, however, a number of companies still on the fence about how to proceed - including the nation's second-largest retail chain.

"We haven't made any final decisions because our enrollment period is a little later than everybody else's," Target CEO Gregg Steinhafel said. "So we're still looking at how the law is being shaped and written, what other competitors are doing and we're assessing the landscape to try and determine what's the right thing for us to do as a company."

Another factor is potential misunderstanding of a lengthy and complicated law that everyone from business people, journalists and even legal and health experts are just now coming to grasp.

Earlier this year, a laundry list of fast-food restaurants announced they would raise prices, cut hours or stop hiring full-time employees to avoid costly penalties for not insuring workers.

However, the healthcare law states a company is subject to enforcement of the law when it has 50 employees that work more than 30 hours per week, not one or the other.

Using data from the Pew Research Center and Statista, the average fast-food restaurant in the U.S. in 2012 employed approximately 25 people at any given time. Since a great deal of chain restaurants are individually operated, their shift workers do not count toward their parent companies' register of corporate employees - people who likely already have insurance.

In an effort to keep companies from skirting the new regulations, there is also a formula included in the healthcare law to determine at what point the service of a large number of part-time employees is comparable to that of full-time workers.

Changes around the water cooler

Smoke breaks at the office - and everywhere else - could potentially become more costly for people who enroll for healthcare through an exchange.

The law allows a surcharge up to 50 percent of the premium cost for people who use tobacco. It is not mandatory, and some states have already decided not to adopt the surcharge.

Some states had implemented tobacco surcharges well before the passage of the new law. However, the average surcharge under current standards is about 20 percent, according to the Kaiser Family Foundation, less than half that under the Affordable Care Act.

The tradeoff is consumers cannot be dropped from coverage for tobacco use or tobacco-related illnesses, another difference from practices under the current system.

There are also new guidelines for a system that provides monetary rewards to people who live a healthy lifestyle.

The ACA promotes employer-sponsored wellness programs by, among other things, returning a percentage of the cost of coverage to people who reduce tobacco use or don't use at all; meet weight or cholesterol goals; or take other steps toward living a healthy lifestyle, even if they are physically disadvantaged.

The Congressional Budget Office estimated non-group premiums for single people would be 10 to 13 percent higher than group plans in the exchanges. However, standard care would be expanded to include things like maternity and mental health.

The federal government will also provide subsidies in the form of tax credits to help people pay for premiums purchased in the exchanges.

"Now we'll have the facts to deal, to push back on some of the misinformation," Health and Human Services Secretary Kathleen Sebelius told CNN. "At every point along the way, the misinformation has been wrong, and I'm really anxious for the markets to be up and running so people see what prices are, what options they have; and what we find is that they're thrilled with the choice and the competition."